‘Strategic’ Defaults In The Recovering Real Estate Market

The Phoenix resale home market rebounded slightly in February, according to the Realty Studies Report from the W. P. Carey School of Business. Compared to January, the number of transactions increased and prices were up a bit. Still, foreclosures accounted for 42 percent of the total market, and the sale of previously foreclosed properties made up 40 percent of the traditional sale segment. Meantime, market watchers are wondering what will happen when the many Adjustable Rate Mortgages (ARMs) reset this year and next. We asked Jay Butler, associate professor of real estate and author of the report, what he thinks about that, and what else he noticed in the February data. (9:20)